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Increase In-House Medical Collections
With managed care eroding medical profit margins, and malpractice insurance costs skyrocketing due to frivolous lawsuits, patient accounts not paid within in a timely fashion can restrict a practice's cash flow and sometimes the ability to provide care.
The following medical collections report outlines 11 guidelines you can follow to increase the amount of in-house medical collections your practice or facility collects.
1] Have a Defined Credit Collection Policy
One of the major causes of overdue medical receivables is that the practice has not defined to its patients, and its staff, when the medical accounts are to be paid. If patients are not educated that accounts are to be paid on time, then chances are they'll pay late or sometimes not at all. Make sure that your medical practice's or facility's terms of payment are clearly stated in writing to each patient and in every invoice or bill.
2] Invoice Promptly and Send Statements Regularly
If you don't have a systematic medical invoicing and billing system, get one. Many times the patient hasn't paid simply because they haven't been billed or reminded to pay in a timely manner. This situation usually occurs in smaller or newer medical practices or facilities where they're short on staff to invoice and bill.
3] Keep Accurate And Timely Payment Records
Once a new patient is accepted for treatment, it is vitally important to maintain accurate and timely records on their payment history. If you see any deviation from past payment patterns, and especially if medical payments become unusually slow, immediate follow-up is warranted. This not only gives you an early alert to impending payment problems, it also gives you the chance for early intervention if there is an outside influence.
4] Use "Address Service Requested"
One of the most difficult collection problems is tracking down a patient who has "skipped". All practices and facilities should be aware of a special service offered by the Post Office. Any statement or correspondence sent out from a practice or facility should have the words "Address Service Requested" printed or stamped on the envelope, just below your return address in the top left corner. If a statement or invoice is sent to a patient who has moved without informing you of their new address, and the words "Address Service Requested" appear on the envelope, the Post Office will research this information and return the envelope to you on a yellow sticker that gives the new address or other updated information. If the patient has placed a "forwarding order" with the Post Office, the Post Office is required to forward the envelope to the patient and send you a form #3547 with the new address and charge you approx. 50 cents. This will keep your address files up to date.
5] Contact Overdue Medical Accounts More Frequently
No law says you can contact a patient only once a month. The old adage "The squeaky wheel gets the grease" has a great deal of merit when it comes to collecting delinquent medical accounts. It's an excellent idea to contact late payers every 10-14 days. Doing so will enable you to diplomatically remind the patient of your terms of payment.
6] Use Your Aging Sheet, Not your Feelings
Many practices or facilities (or well-meaning people on their staff) have let a medical account age beyond the point of ever being collected because he or she "felt" the patient would pay eventually. While there are a few isolated cases of unusual situations, the truth is that if you aren't being paid, someone else is. So stick to your systematic plan of follow up. You'll soon know who intends to really pay and who doesn't. You can then take appropriate action once you know where you stand.
7] Make Sure Your Medical Billing Staff is Trained
Even "experienced" staff members can sometimes become jaded when dealing with delinquent patients. This usually occurs when the patients have made and then broken promises for payment. Make sure your billing staff is firm, yet courteous when dealing with the delinquent patient. Your collection staff could benefit from patient service training because, in effect, they must "sell" your patients on the idea that you expect to be paid. Make sure that your collection staff is trained to not only bring the account current, but to also maintain good will with them as you might be caring for them in the future.
8] Admit and Correct any Mistakes on Your Part
Sometimes patients don't pay because they feel you've made a mistake. If you have, quickly admit it and correct it. Your patient should understand that mistakes occasionally occur. Unfortunately, many patients believe that "the Doctor doesn't need the money". Denying an obvious error only fans the fire of resentment your patient may already feel.
9] Follow the Collection Laws in Your State
In many states, practices are governed by the same collection laws as are collection agencies. For example, calling patients at an odd hour or disclosing to a third party that they owe you money are just a couple of the numerous collection practices that can cause serious repercussions. If you're not sure, call your state's department of finance which governs and monitors collection agencies. Click Here for a summary of the Fair Debt Collection Practices Act.
10] Use a Third Party Medical Collections Agency Sooner
If you've systematically pursued your delinquent medical accounts for 60 to 90 days from the due date, (and they still haven't paid) you're being delivered a message by your patient. More than likely, you've requested payment four to six times in the form of phone calls, letters and statements. Statistics show that after 90 days, the effect of in-house collection efforts wears off 80%". That means that the time and financial resources budgeted for medical collection efforts should be focused within the first 90 days where the bulk of your accounts can and should be collected. From that point on, a third party medical collections agency can motivate a patient to pay in ways you cannot, simply because the demand for payment is coming from someone other than you. Before paying a percentage to a collection agency, or using small claims court or an attorney, check into using a flat fee medical collection service.
11] Remember that Nobody Collects Every Medical Account
Even by setting up and adhering to a specific medical collections plan, there are a few medical accounts that will never be collected. By identifying these accounts early, you will save yourself and your medical practice or facility a great deal of time and money. Even though a few may slip by, you'll find that overall the number of slow pay and non-paying accounts will greatly diminish, and that's a victory in itself!
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